2018.06.06 Affinity Media – The French advertising market on Q1 2018

In the first quarter of 2018, on the scope observed by IREP (television, cinema, radio, print, outdoor advertising, advertising mail, unaddressed printed matter), net media advertising revenues amounted to €1,920 million, down by -2.0% compared to the first quarter of 2017. As a reminder, in the first quarter of 2017, the trend was close, at -2.5% vs. the first quarter of 2016.

This result is part of an economic situation, which is less well oriented than that of the last quarter of 2017 with notably a GDP at +0.3% in the 1st quarter of 2018 vs +0.7% in the 4th quarter of 2017, with household consumption expenditures at +0.2% equivalent to that of the 4th quarter of 2017 and an unemployment rate up by +0.2 point.

It also suffers from a deteriorated social climate and particularly bad weather.

Television, + 1.8% in the 1st quarter 2018 (vs. -0.8% in the first quarter of 2017) growth driven in particular by sponsorship, which rose by + 32.0%.

Cinema, + 14.4% (vs. -14.1% in the first quarter 2017).

Digital outdoor advertising, + 10.9% (vs. + 12.4% in Q1 2017).

Outdoor, + 4.6% (vs. -5.7% in Q1 2017).

Transport display, + 2.3% (vs. + 9.5% in Q1 2017).

Unaddressed printed matter, + 0.9% (vs. + 1.9% in Q1 2017).

We estimate that, by integrating Internet advertising revenues for the 1st quarter of 2018, the situation of the media advertising market would be up + 1.5% to + 2.0% compared to the 1st quarter of 2017.

The Sectors Dynamics

The cross-media advertising market is the benchmark for 31,036 advertisers. As a reminder, in 2017, the number of advertisers increased by +3%. In the first quarter, this trend is accelerating and seems to be 3 times higher to reach +9%, an indicator that is evolving 3 times faster at the beginning of the year.

The breakdown by media shows us that digital is gathering the largest number of advertisers with a portfolio that continues to grow (+16%). In addition, digital media (display + search) captured 70% of advertisers on the French market in the first quarter against 66% for the whole year 2017.

As to market segments, distribution remains the leading sector on the market with a 15.4% share of voice but saw a slowdown in growth this quarter (+ 3%). Automotive (+ 20%) and tourism (+ 15%) stand out with their double-digit growth, while food is returning to a positive trend in its investments (+ 2%). Conversely, the largest declines come from the services, health and leisure culture segments.

2018 Forecast

The Market growth was +2.2% in the 1st quarter 2018. This growth is therefore in line with the annual forecast of +2% for 2018 made at the end of 2017.

The main sector trends across the entire scope Print, Television, Cinema, Outdoor, Internet (search and display) are as follows:

Consumer goods: € 933 million (+ 1.9%) – This sector is returning to investments growth after a negative year in 2017, with radio and internet investments picking up again.

Retail: € 369m (+ 2.9%) – This sector continues to grow at the same rate as in 2017, internet investments remain strong and outdoor advertising is once again positive.

Services: € 987m (+ 1.4%) – Here again, this sector growth is identical to that of 2017, with Internet and TV investments still contributing strongly to this growth; however print, outdoor advertising and radio are significantly down.

NB : Information from BUMP (Baromètre Unifié du Marché Publicitaire – i.e. France Pub + Irep + Kantar Media): The quarterly review of the advertising market is the result of the reconciliation of Kantar Media gross advertising pressure data with the net expenditures of advertisers reported to France Pub and the advertising revenues of the advertising sales agencies collected by IREP.